Weekly Wrap-Up: Earnings Share Spotlight With Trump

Fourth-quarter earnings season kicked into high gear, but it was Donald Trump's inauguration as 45th president of the U.S. that stole the show

Jan 20, 2017 at 2:48 PM
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Amid a busy week of corporate earnings and Fed speeches, it was newly inaugurated President Donald Trump that once again stole the stock market spotlight. Specifically, stocks started the week in negative territory, after Trump issued harsh words toward the U.S. dollar, sending the greenback tumbling. What's more, the CBOE Volatility Index (VIX) popped on Tuesday -- although Schaeffer's contributor Adam Warner suggest these short-term spikes could happen with more frequency going forward, and is something options traders have been seemingly been bracing for. Nevertheless, after logging its longest losing streak since early November and taking a brief trek into negative year-to-date territory, a shift in sentiment today has the Dow on track to notch its first win of the week.

Trump's market-moving comments spread to other areas of Wall Street, as well, with his promises of "insurance for everybody" helping lift healthcare stocks. And while most of Trump's Twitter feed was dedicated to events surrounding Inauguration Day, the president took time out to praise General Motors Company (NYSE:GM), Wal-Mart Stores Inc (NYSE:WMT), and Monsanto Company (NYSE:MON) on their job creation promises.

However, not all the week's action revolved around the comings and goings in Washington D.C., as fourth-quarter earnings season kicked off in earnest. Big-cap banks stole the show early on, with Morgan Stanley (NYSE:MS), Citigroup Inc (NYSE:C), and Goldman Sachs Group Inc (NYSE:GS) all failing to capitalize on profit beats in the wake of their respective results amid broad-market headwinds. There was plenty of positive post-earnings price action to be found, though, just ask Netflix, Inc. (NASDAQ:NFLX) or International Business Machines Corp. (NYSE:IBM) shareholders, with the latter erasing an earlier deficit to hit a fresh annual high.

There was also plenty of M&A buzz circling Wall Street, with news of Sanchez Energy Corp's (NYSE:SN) big asset purchase -- and subsequent round of bullish brokerage attention -- sending the shares into annual-high territory. Eli Lilly and Co's (NYSE:LLY) nearly $1 billion purchase of CoLucid Pharmaceuticals Inc (NASDAQ:CLCD) also earned praise from analysts, while rumors of a potential blue-chip takeover sparked a surge in shares of 3D Systems Corporation (NYSE:DDD).

Looking ahead, though the SPDR S&P 500 ETF Trust (SPY) continues to trade south of this key technical level, data from Schaeffer's Senior Quantitative Analyst Rocky White suggests the so-called "Trump rally" could have room to run, given the S&P 500 Index's (SPX) uptrend between the election and Inauguration Day. And while blue-chip names will dominate the earnings calendar during Trump's first official week in office, a list of historical post-inauguration outperformers and underperformers shows these two oil stocks and this drink maker should be ones to watch.

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